Results: RHI Magnesita India Limited Delivered A Surprise Loss And Now Analysts Have New Forecasts

Investors in RHI Magnesita India Limited (NSE:RHIM) had a good week, as its shares rose 4.8% to close at ₹707 following the release of its annual results. Things were not great overall, with a surprise (statutory) loss of ₹4.88 per share on revenues of ₹38b, even though the analyst had been expecting a profit. This is an important time for investors, as they can track a company's performance in its report, look at what expert is forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimate to see what could be in store for next year.

View our latest analysis for RHI Magnesita India

Taking into account the latest results, the consensus forecast from RHI Magnesita India's sole analyst is for revenues of ₹40.8b in 2025. This reflects a reasonable 7.7% improvement in revenue compared to the last 12 months. RHI Magnesita India is also expected to turn profitable, with statutory earnings of ₹16.00 per share. Before this earnings report, the analyst had been forecasting revenues of ₹44.1b and earnings per share (EPS) of ₹17.00 in 2025. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a small dip in earnings per share estimates.

Despite the cuts to forecast earnings, there was no real change to the ₹769 price target, showing that the analyst doesn't think the changes have a meaningful impact on its intrinsic value.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's pretty clear that there is an expectation that RHI Magnesita India's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 7.7% growth on an annualised basis. This is compared to a historical growth rate of 35% over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue shrink 6.9% per year. So it's clear that despite the slowdown in growth, RHI Magnesita India is still expected to grow meaningfully faster than the wider industry.

The Bottom Line

The biggest concern is that the analyst reduced their earnings per share estimates, suggesting business headwinds could lay ahead for RHI Magnesita India. Sadly they also cut their revenue estimates, although at least the company is expected to perform a bit better than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At least one analyst has provided forecasts out to 2027, which can be seen for free on our platform here.

You should always think about risks though. Case in point, we've spotted 1 warning sign for RHI Magnesita India you should be aware of.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.